All Forum Posts by: Douglas Fox

Hi Michael,  I would say "Go for it."   We had a vacancy at one of our long-term rentals and we took the opportunity to convert it to a Short-Term Vacation Rental and we are not looking back.   We used to get one of the highest monthly rental rates in our area but now we are getting 1.5x, 2x, and 3x the previous monthly income rate.  So we are, in some months, tripling the return that we used to be getting and we started this new initiative in the middle of the pandemic.   Guests are giving our property rave reviews, and we are enjoying being hosts to many people from around the country and even around the world.  So NO, this is not a bad time to get into this amazing revenue stream.  One thing that helped us make the jump, which included about 3 months (without any rent) of renovations and the considerable expense of furnishing the house, was attending a 3-day Vacation Rental boot camp where about 20 or 25 like-minded people came together to share their experiences.  Once I experienced the energy of these folks, I knew we were on the right track and I came back home with lots of good ideas and suggestions.  We are very happy that we made this move, I think you will be too.

Hi Chelsa,   It sounds like you have seen the underbelly of renting property early on. This is important for prospective landlords to be aware of just what is out there in the tenant community.   But having said that there are also wonderful tenants who can be found after diligent and patient searching.  Tools are available to find the cream of the crop after much due diligence.  You have already seen the dangers and expenses involved in choosing a tenant too quickly or rashly.   As far as long term vs. short term tenants, it is usually fair to say that greater gross income potential is available with a vacation rental.  You can also find companies who will do some of the vetting for you to be sure you are getting a quality vacation renter.  We were surprised just how much interest there was in our single family home offered as a vacation rental.   Some have referred to owning one of these as owning a "money machine."  Everyone can always use another money machine conveniently located near their home.  So it would be easy for you to maximize income by potentially doing the cleaning yourself, at least at the start.  You could also keep an eye on what is going on back there, so that if someone is starting to have too much fun back there you could give them a call or other authorities if necessary.  So I think you are right track to view this asset as a potential source of income that you want to learn as much as possible about and develop into a revenue stream. 

Here are three reasons: Location, Location, Location.

My mentor in Vacation Rental was Brad Moncado.  He runs a 3-day event in Branson, MO devoted to this subject.  His first slide shows a map of the entire United States and really all of North America and then he asks the question to the crowd:   "Where does this idea work?"  People call out:  "Southern California," "Florida" "Gulf Coast" and then he shows the second slide, which is an identical map of the entire United States and North America.  And then he proclaims, the correct answer is "Everywhere!"  We converted a long-term rental in a very remote corner of our state following his training methods and the results have borne out the complete accuracy of his statement.

I had a friend who had a fabulous rustic cabin on an island in the middle of Lake Winnipesauke in New Hampshire.  On my first visit to the island, he had just brought me and several others over to the island on his boat.  It was a gorgeous fall day and the place was looking absolutely spectacular.  I went over to my friend who was a jet engine  engineer, and being full of enthusiasm for having just landing on the island, I said to him:  "There must be a lot of advantages and disadvantages of living on an island."   He was smoking his pipe, he slowly dropped the pipe from his mouth and turned to me and said:  "I can't think of one advantage."  He slowly turned and walked away.  I never will forget that moment.

Patience and diligent marketing in new venues may be rewarded in this instance.  If it doesn't "feel 100% solid" you might want to trust your instincts.  A mistake here has the potential to possibly make you start everything all over again.

@YiBing T.  A tenant that is not paying rent is like a tooth that has to come out.  It will not help you, only hurt you to delay the process.  You have to get the tooth out, no matter what the expense.  You must hire an eviction attorney who will do the deed.  immediately.  If the moratorium is still in effect, you must insist that the attorney file the eviction the day the moratorium comes off.  You must explain your resolve to execute this legal action continually to your tenant while you wait.  You must reason with the tenant and explain how they will never be able to rent again, nor ever buy a house, once your legal proceeding is complete.  You plan to make this record of eviction stick to them like glue.  As their landlord you must explain how you will sell their debt to a collection agency.  The collection agency that purchased the debt will report it to Experian and the other credit bureau's, the account will then appear on their credit report as a collection account for the next seven years.  They will also be hounded by the collection agency with unrelenting legal, phone efforts to recover the debt, it could effect their possibilities of future job opportunities, when they check the credit.  In light of all this, you should ask them, "If I would be able to give you some money to find another place to live, would you be interested in receiving my cashiers check in exchange for X amount delivered to you outside the truck after you have packed up all all your possessions?  Explain that they are like a tooth that now has to come out.  It is coming out ASAP one way or another.

@Justin Kerstetter,  I recently attended a great 3-day workshop/Bootcamp in Branson, MO which was dedicated to the topic of short-term rentals.  I feel like I got everything I needed, from the great instructor to venture forth now with our first Short Term Rental.  Ours will be going live next week on the platforms (i.e. AirBnB, Vrbo, etc).   I am excited to see how this approach will compare to our Long Term Rentals in terms of revenue which we have had for many years.   If it doesn't catch on with sufficient bookings which exceed the previous monthly rental price (i.e. $1,800/mo.) then the backup plan is to revert to listing it once again as a Long Term Rental, but this time we would lease it as  "furnished" and raise the rent accordingly.   I can provide the details on the Workshop/Bootcamp if you want to reply back to me.